Everybody who is working has a contract with their employer, whether it's in writing or not. It's automatic and the contract terms are pretty simple. This salary that somebody receives is provided in return for this services they've agreed to provide no matter what it is that they're doing, that's a contract. The law infers in that contract of employment. Various terms, there are department of labor laws that employers must comply with regardless of whether you have a written contract or not. One term that's implied in every employment contract is that an employee is not allowed to Sue their employer for an injury on the job to give up the right to be able to Sue your employer and employee get something very significant. In return, the employer must provide workers' compensation benefits. So it works like this. Anybody on the job who is injured in any way is entitled to recover from their employer.
Workers' compensation benefits in very broad strokes, covers economic loss. Economic loss is wages and cost of medical expenses. So, anybody working who's injured on the job cannot sue their employer but must file for workers' compensation. In return, the employer must provide those workers' compensation benefits. So you may ask, well, why is there a workers' compensation judge? And isn't that a lawsuit? It really is not technically a lawsuit. It's a claim for benefits that must be provided simply because somebody makes a claim. It doesn't mean that the workers' compensation insurance company must pay that claim. And that's where workers' compensation judges make a determination as to whether or not the employee is eligible, where they actually working at the time, where they in the course of their employment, when the event happened, and what are the benefits that they're entitled to. So it's really a claims based non-litigation based system and it, the purpose of it and the social benefit of it is we don't want employees thinking of how to Sue their employer to recover benefits for injuries on the job.
When somebody is injured on the job and it is through somebody else's fault, the person who caused the injury is still able to be pursued. So the workers' compensation and when an employee gives up their right to Sue their employer, it's broader than simply their employer. It also includes a co employee. So if anybody is on the job and it co employee or their employer does something that results in injury, you're limited to workers' compensation. But if you're in the course of your employment and somebody or a corporation other than your direct employer or a co employee of the same employer, then you are entitled to recover and possibly from the what's called a third party. And let me just take a moment to define the distinction between first party and third party in law.
Learn more about how this works in the video.